BEIJING • China will exempt some agricultural products from additional tariffs on US goods, the official Xinhua News Agency said yesterday, in the latest sign of easing Sino-US tensions before a new round of talks aimed at curbing a bruising trade war.

The United States and China have both made conciliatory gestures, with China renewing purchases of US farm goods and US President Donald Trump delaying a tariff increase on certain Chinese goods.

“The Customs Tariff Commission of the State Council will exclude some agricultural products such as soya beans and pork from the additional tariffs on US goods,” Xinhua reported, citing sources.

Mr Trump had also said on Thursday that he would be open to an interim trade deal with China, but would prefer a lasting deal.

“I would rather get the whole deal done,” he told reporters at the White House. “I see a lot of analysts are saying an interim deal, meaning we will do pieces of it, the easy ones first. But there is no easy or hard. There is a deal or there is not a deal. But it is something we would consider, I guess.”

Trump administration officials have discussed offering a limited trade agreement to China that would delay and even roll back some tariffs for the first time in exchange for Chinese commitments on intellectual property and agricultural purchases, according to five people familiar with the matter.

The discussion is preliminary, and Mr Trump has yet to sign off on it. The proposal would freeze the conflict rather than bring a final resolution to a trade war that has cast a shadow over the global economy. US equities and Asian stock futures advanced after news of the talks.

The plan reflects concerns in the White House over the recent escalation in tariffs and their economic impact on the US going into an election year. Polls show that the trade war is not popular with many voters, and farmers are increasingly angry over depressed commodity prices.

One of the main goals is to strike a deal allowing the administration to avoid going ahead with more tariffs in December that would hit consumer products ranging from smartphones to toys. Also in play is a further delay in a tariff rate hike due to take effect next month.

Late on Wednesday, Mr Trump tweeted that he was putting off the 5 per cent increase in tariffs on Chinese goods, originally set to take effect the first day of next month, until Oct 15 – out of respect for the Oct 1 celebration of the 70th anniversary of the founding of the People’s Republic of China.

Earlier that day, China also said it would exempt some US drugs and other goods from tariffs.

China has bought US pork despite tariffs of 62 per cent in place since last year as huge numbers of pigs have been culled across the country, which is struggling to contain an outbreak of African swine fever.

While welcoming China’s overtures, US Treasury Secretary Steven Mnuchin sought to temper optimism in markets that the gestures might lead to a trade deal.

He told CNBC that Mr Trump was prepared to keep or even raise tariffs on Chinese imports and that Beijing had asked for more concessions beyond the removal of tariffs.

“The next month is important,” he added at a later event hosted by The New York Times. “We are hopeful we will make progress. If we can get the right deal, we will do a deal.”

Lower-level US and Chinese officials are expected to meet next week in Washington ahead of talks between senior trade negotiators early next month. Top-level negotiators last met face to face in China in July.

Washington is pressing China to end practices it considers unfair, including intellectual property theft, industrial subsidies, currency manipulation and forced technology transfer from US companies to Chinese counterparts.

Mr Trump has made clear he wants such elements to be part of a deal and has demonstrated his resolve through tariff increases, even when they dented gains in the stock market. Meeting US demands would require structural change in China, which it has been unwilling to make so far.

The two sides came close to a deal in May, but Chinese officials baulked at requirements that Chinese laws be altered as part of the deal.

BLOOMBERG, REUTERS

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